How can I round out this join?
There may be many ways to do it (using the knife project or to sphere tools e.g.). I'll show you a method wich uses a spin tool though.


Select the vertex which creates the straight angle and rip it (V). After selecting two vertices press G twice to slide them. This way you can set the size of the round joint.


Next with the two vertices selected snap the cursor to them (Shift+S-->Cursor to Selected). Change the pivot point type to 3D Cursor and enable snapping tool (Vertex). Select the bottom vertex, snap the cursor to it and (being in side view) press the Spin button (set the steps number in a Tool Shelf as you like). Next select the vertices of the arc, rotate and scale it to make the joint.


Finally remove doubles (select the whole mesh with A, then press W-->Remove Doubles). Fill the hole with F.




UPDATE: Using to sphere tool:


Select the vertex which creates the straight angle, press Shift+Ctrl+B and set the arc's size. Enable snapping tool (Vertex). Extrude the bottom vertex and snap it to the other one as pictured below. Snap the cursor to it (with 3D Cursor pivot point type), then delete it. Select the diagonal edge, subdivide it (W-->Subdivide) and set the subdivisions number in a Tool Shelf. Next press Shift+Alt+S,1. Finally translate the arc along Y and Z axes to snap it to the other vertices.